How to help the elderly avoid financial scams

Recently, my 86-year-old mother-in-law received a call from her grandson, saying he was in jail and needed bail money.

Turns out the caller was not her grandson but a fraudster who managed to cajole his name out of Grandma while making up a story of distress. Fortunately, she didn’t take the bait and hung up.

Such scams are increasingly common as our population ages, with seniors victimized not only by strangers but also by relatives and caregivers.

But there are ways to protect your loved ones.

Fraud and Financial Abuse Awareness Month, starting next week, is a good time to alert seniors and their loved ones about signs of financial abuse and what to do if there’s a problem.

In the last fiscal year, the Dallas-Fort Worth district of Adult Protective Services investigated 236 cases of financial exploitation of seniors, according to Amanda Polk, special investigation supervisor at the state agency.

But she estimates that the agency learns of half the cases.

“There are some who don’t call us because they are fearful of what will happen to them or their family,” Polk said. “They normally have a long-term relationship with the person taking advantage of them.”

In one recent case, a woman turned over control of her finances to her son while she was in the hospital so she could keep up with household expenses. The son used $300,000 of her money, Polk said. Among his purchases: a Tesla.

“Her bank noticed a change in her normal spending — an automatic red flag — and notified us,” she said. “We have taken the case to the district attorney.”

“We get tips from banks, broker-dealers, CPAs and other professionals,” he said.

In the board’s current fiscal year, which ends this month, it had 25 enforcement actions involving 100 seniors, Rotunda said.

The No. 1 crime against the elderly was selling unregistered securities, he said. Viatical, or life settlements — selling your life insurance policy to a third party — was also high on the list.

Seniors see a lot of advertisements pitching “safe” investments that also tout higher rates of return than traditional certificates of deposit, Rotunda said. Often they are not safe or profitable, he said.

We ask people to call and ask us before you invest instead of after. We will search our database and even can see out-of-state investments that have a red flag.

Joe Rotunda, Texas State Securities Board

“We ask people to call and ask us before you invest instead of after,” he said. “We will search our database and even can see out-of-state investments that have a red flag.”

The board has been proactive in the past couple of years about seeking out these “deals” and having someone go undercover as either an investor or a potential employee to see what’s really behind it.

“If we can stop a scheme before it collapses, everybody wins,” he said.

Here are some other tips from the November issue of Consumer Reports:

▪ Stop robocalls. Sign up for Nomorobo, a free service for those with VoIP from Time Warner, Comcast, AT&T U-verse and Verizon FiOS. You can also use a whitelist blocker to disallow calls from numbers that are not programmed into the device. Sign up for the free National Do Not Call Registry (donotcall.gov or 888-382-1222), which will limit legitimate marketing calls but won’t prevent crooks from calling.

▪ Have someone help pay the bills. Create a shared bank account with a friend or relative. See whether your financial institutions will send statements and alerts to a trusted person who has no direct access to a senior’s account but can check for fraud. Try EverSafe, a paid Web-based service that consolidates accounts in one place and checks for suspicious activity daily.

▪ Set up an emergency plan. Give power of attorney to someone you trust who is financially secure. The document can include assigning a relative or friend to monitor the person; mandate a written report of financial transactions; or assign joint powers of attorney, which would require two signatures on every check.

Teresa McUsic’s column appears Saturdays. TMcUsic@SavvyConsumer.net

Reporting senior financial abuse

▪ Adult Protective Services. State law requires anyone who suspects abuse, neglect or exploitation to report it. For seniors still at home, call the Texas Abuse Hotline at 800-252-5400 or report online at www.TxAbuseHotline.org.

▪ Texas Department of Aging and Disability Services. To report financial abuse of seniors in a nursing home or other facility, or those who have home healthcare, call 800-458-9858.

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